Not even this many: This Economist cartoon paints a false picture of the situation. The magazine has stated: “In Britain, which had to bail out three of its biggest banks, not one senior banker has gone on trial over the failure of a bank.”

Here’s a word that should be in all our dictionaries but probably isn’t: ‘MAXWELLISATION’.

It refers to a procedure in British governance where individuals who are due to be criticised in an official report are sent details in advance and permitted to respond before publication. The process takes its name from the late newspaper owner Robert Maxwell, who fell off a yacht after stealing the Mirror Group’s pension fund.

Maxwellisation is how the irresponsible bankers who caused the economic recession, out of which some of us have just climbed according to the latest figures, are likely to get away Scot (and the word is used most definitely in reference to the land north of England) free.

Current folk wisdom has it that most of us are still unhappy about the banking crisis. We want to see heads roll.

This is a serious headache for the Coalition government, according to Private Eye (issue 1371, p33: ‘Call to inaction’) – because almost nobody involved in that fiasco is likely to suffer the slightest inconvenience.

They really are going to get away with it because the government of the day really is going to let them.

It seems that Andrew Green QC has been hired to find out whether action could and should be taken against those who bankrupted HBOS, beyond corporate lending chief Peter Cummings, who has already been banned for life from the industry and was fined half a million pounds in 2012.

That might seem a lot of money but the HBOS crash, along with that of the Royal Bank of Scotland, cost the taxpayer £60 billion (along with who-knows-how-much in interest payments).

Mr Green has also been asked why HBOS chief executives James Crosby and Andy Hornby were untouched, along with chairman Lord Stevenson.

For the facts, he need look no further than what happened with RBS, the Eye reckons.

In 2010, the Financial Services Authority – discredited forerunner to the FCA – allowed (allowed!) RBS’s top investment banker Johnny Cameron to ban himself from another senior banking job. The following year it pronounced chief executive Fred ‘The Shred’ Goodwin and chairman Sir Tom McKillop effectively blameless. Mr ‘The Shred’ was stripped of his knighthood, however.

This whitewash appears to have been an embarrassment for business secretary Vince Cable, who announced in December 2011 that he wanted to prosecute, disqualify as directors or ban from the financial sector those responsible at RBS and passed his request for disqualification up to the Scottish law officers in early 2012.

He is still awaiting an answer, it seems.

Back to HBOS, where Cable has made “similar disqualification noises”, according to the Eye, after a “highly critical” report from the Parliamentary Commission on Banking Standards last year.

Unfortunately for him, not only is HBOS also based in Scotland, so any proceedings may have to follow a similar path to those involving RBS, but also the FCA’s report into the bank’s failure is currently “unfinished”.

This is because it is being “Maxwellised” – according to the Eye, “whereby lawyers for those in the frame (if allowed) remove anything critical of their clients”.

The report continues; “With RBS, ‘Maxwellisation’ took several months and resulted in the whitewash that made any future action against those found not guilty difficult, if not impossible.

But the public wants heads to roll! Will anybody get what’s coming to them?

According to the Eye, the answer is a qualified “yes”.

Only one boss of HBOS still has links with any organisation regulated by the FCA – James Crosby is a director of the Moneybarn sub-prime car finance group and its parent, the Duncton Group. The FCA took over regulation of the consumer loan industry in April and has until December 2015 to provide full approval to the Moneybarn operation. The Eye states: “By then chairman Crosby would have to pass its ‘fit and proper’ test. He is completely unauthorised. So, a low-hanging scalp.”

This is a reblog in all but name – Michael Meacher MP, writing on Left Futures, tells us that Gideon George Osborne is keen to re-privatise the Royal Bank of Scotland and Lloyds before the next general election – not to maximise the Treasury’s gain but to spite the Labour Party!

In fact a sale at this time would result in a loss of £24 billion at current share prices. According to Mr Meacher, it seems the chancellor who forced £18 billion of cuts on benefits for Britain’s poorest, and £81 billion of cuts on public services, is perfectly happy to lose this huge amount of money for ideological purposes.

Mr Meacher says Labour would break up these banks and reconstruct them as sources of investment in industry, lending out money in order to boost the economy.

The Conservatives were never really interested in sorting out the economy, of course – their plan was always to privatise as much as they could, create a market out of as many public services as possible, in order to suck money out of the working- and middle-classes who rely on public-sector services to keep their costs down.

People are starting to realise that at last, and it is to be hoped that today’s election results reflect this newfound understanding.

Time is running out for the UK economy but the banks have managed to walk off with hundreds of billions of pounds in taxpayers’ money. When do we get it back?

I was listening to Gideon George Osborne’s Autumn Statement the other day – and my word, don’t I wish I hadn’t! In between lapses of concentration due to boredom and bursts of sudden fury, depending which idiot pronouncement he was drooling, I had the odd lucid thought, one of which was this:

The financial crisis was caused by bankers. Did anyone ever identify who they were?

It’s a good question and one that I don’t believe has ever been answered. A cursory search reveals no list of British names on the Internet but I don’t think we can blame it all on Fred Goodwin, can we? (Fred ‘the Shred’ was, you’ll recall, stripped of his knighthood due to his role in the banking crisis, as chief executive of the Royal Bank of Scotland)

If nobody else has been named, we can conclude that none of them have been made to account for their actions or pay recompense to those of us who have had to suffer hardships – some extreme – indeed, some fatal – as a result of the foolhardy way they gambled with money that was not theirs and nearly brought the global financial edifice crashing to destruction.

It’s nearly five years since the crash. We can reasonably expect that these people are still in position, still taking home huge bonuses every year (debate among yourself whether they have earned these amounts or not). They have not been held accountable. It seems increasingly unlikely that they ever will.

But their organisations have absorbed huge amounts of public money, paid during the great bailouts of 2008 onwards by the UK Treasury in order to keep them going. It seems to me that these fatcats should be on starvation rations until that debt is paid off but I don’t see that happening. This leads me to my next question:

When are we going to get our money back?

The answer comes to mind immediately: If events continue along the current pattern – never.

That’s not good enough. In fact, it’s downright disastrous for the British economy because we all know by now – and the Autumn Statement confirmed it – that the welfare squeeze and other measures that Gideon has levelled at those of us on low or medium incomes, for the hideous crime of having nothing to do with the banking crisis that led to the recession, isn’t going to make anything better. In fact it can only make matters worse.

Consider fiscal multipliers. Every pound invested by a government in its economy generates more money as it goes through the system. The classic example is investment in construction, which yields more than £2 for every £1 spent. But if you subtract money – for example, by a fiscal squeeze – it follows that the economy suffers a greater loss than just the money that was taken away. I believe writers other than myself have suggested that the planned extra £10 billion welfare squeeze will remove £16 billion from the economy.

Meanwhile the banks, that caused the crisis, are off the hook and free as birds.

I have already stated my belief that the economy needs government investment in order to grow. If that investment took place, people would start making money again and they would logically put it into the banks. At this point, I suggest it would be reasonable to start encouraging the banks to start paying off their debt to us; there could be no argument that repayment would harm their viability as they would be benefiting from new money.

They could start paying a financial transactions tax (FTT) at a rate of 0.1%, applicable to all transactions through the CHAPS (Clearing House Automated Payments System) which is used to make same-day, irrevocable payments. If spent on deficit reduction alone it was envisaged in 2010 that this would halve the deficit by 2013/14. The introduction of the tax at that time would also have fended off overtures of a rise in regressive taxes such as VAT to 20 per cent, which left the most vulnerable in society picking up the bill for the mistakes of the very well-off. It differs from the ‘Robin Hood’ Tax Campaign for a 0.05 per cent tax on banking transactions, as the latter targets a broader range of banking activities. Most of the major EU countries supported such a tax, and on July 18, 2010, the then-head of the IMF, Dominique Strauss Kahn, announced he would back it.

I would also continue levying the Bankers’ Bonus Tax introduced by Alistair Darling in 2009, which raised £2 billion, and extend it to other institutions such as hedge funds and private equity houses, which benefited from the bailout through government-backed guarantees and quantitative easing.

If banks continued to pay excessive bonuses then the tax yield would remain high, accruing a large amount for the Treasury, and a permanent bonus tax could lead to bonus payments being reduced as a way to avoid tax; discouraging the payment of bonuses.

This windfall tax has been replicated in France, where the government warned banks that if they did not obey the strict guidelines on pay they would be excluded from competing for exclusive government contracts.

How about a remuneration cap? This would be a short-term ceiling on total remuneration, given as both cash and share options. This would tackle flagrant high pay, shoring up balance sheets and providing a level playing-field across the banking sector.

The link between excessive pay and the economic crisis is widely acknowledged. Remuneration caps could therefore give greater economic stability to the banking system.

I would also create a High Pay Commission – an open, balanced and thorough examination into pay and income at the top in order to find long term and tested solutions into how better to reduce excessive risk and excessive rewards.

Obviously I would separate banks that engage in ‘retail’ activities from those that engage in ‘investment banking’. I would close that casino because the players use other people’s money. Also, ‘casino’ bankers would be less likely to make riskier choices as they would not have protection from the taxpayer. They would also be regulated, to ensure their actions do not put the economy at risk. I understand this is taking place but I can’t fathom why the government is dragging its feet.

Banks should be encouraged to profit by serving their customers well and collectively providing liquidity and capital to the economy.

These banking regulations would be best enforced multilaterally, by other countries as well as the UK, but this should not stop the UK government taking action on its own.

The disproportionate influence of the financial sector over the UK economy leaves it particularly vulnerable to future crises and we should not allow ourselves to be at the mercy of international consensus.

We know that some automatic opposition to these policies will include fear-mongering that talented individuals will leave Britain in droves and growth will be hit. Evidence indicates this is unlikely but if they want to go, I say, let them. There are plenty more talented people just itching for a chance to take their place.

Others will claim that some tinkering with the system, such as banks planning how they wind-up and toughening up existing rules on capital adequacy and liquidity, will solve all our problems. They won’t. There are some fundamental problems that need to be solved if we are to avoid repeats of this crisis.

Better people than myself have said we must reverse the trend of the past 30 years, where private financial risk has been publicly shared and the gains increasingly privatised.

That’s the truth of it. If we can’t punish the transgressors, we can at least claw back the money they have taken.

Did Theresa May just declare open season on highly-paid bankers? I think she did.

It’s very pleasant that Stephen Hester of the Royal Bank of Scotland has turned down his bonus of around £1 million, after the Labour Party called for a Parliamentary debate about the subject.

But more bankers’ bonuses have yet to be declared, and could total hundreds of millions of pounds, if not billions.

At the same time, Home Secretary Theresa May has announced pay cuts for the police.

Big boost for the rich; big let-down for law enforcement.

Now.

I don’t know about you, but if I was a banker I’d be very worried about all this.

What if members of the criminal fraternity knew I was a banker? And what if they believed I’d be in line for one of these huge bonuses (it won’t matter if I am or not)? Wouldn’t that be, in their eyes, an invitation to break into my house and take whatever they can? After all – I can afford it, right?

And the cops’ noses are bound to have been put so far out of joint that they won’t be interested in sniffing out the culprits.

It’ll be more than their jobs are worth.

Nice one, Theresa. Not only is it open season on bankers, but you just shot yourself in the foot.

As I type these words, this has been a day of defeat for the government. Its bid to cap benefits at £26,000 – forcing some families to face the prospect of losing their homes – has been defeated by the Lords, while in the Commons, MPs totally failed to cap the spectacularly high amounts paid to (for example) bankers.

The link between the two is the average amount of pay earned by workers in the UK today. The government says this is £26,000, which Tory MP Margot James seems to think is a large amount of money. I wonder how she describes the current average salary for an MP like herself, which is £65,738, two-and-a-half times as much. In addition, MPs receive allowances to cover the costs of running an office and employing staff, having somewhere to live in London and in their constituency, and travelling between Parliament and their constituency – and we all know that no MP has ever – ever – abused those allowances, don’t we?

The fact is that on a day when the Royal Bank of Scotland has been asking the government to allow it to pay bonuses worth £500 million to staff who have put that firm into the red by £750 million in the last six months, £26,000 is not a high figure. It is a derisory figure. A pittance.

People on benefits, and those speaking for them, have argued that this figure will not be enough to keep many of them in their homes. That is why the Lords voted to exempt Child Benefit from those included in the cap – in order to offer children a stable environment in which to grow up.

The question arises: If it isn’t enough to keep families on benefits in their homes, how do working people who are earning less than this amount manage to make ends meet?

My own experience colours my answer to that: Very badly. When I was last in a full-time job, the salary did not cover all my outgoings and I had to give it up for that reason. Simple as that. Fortunately my partner finally succeeded in a years-long battle to claim Disability Living Allowance shortly afterwards and I became a carer – and we’re better off that way. That’s not an indictment of the welfare and benefits system; it’s an indictment of the way wages have been depressed below the rate of inflation for the last 30 years or so.

I’m told the firm lost business after I left. To me, that indicates a lapse of judgement in allowing me to go, and that bosses might have been better off if they had offered me a sum that would have allowed me to go on living comfortably, rather than worrying about a long, slow slide into debt (to the bank! where the bonuses happen).

I would rather be in a paying job than a carer. I don’t believe I’m betraying my partner, who needs the care, by saying that. But I don’t believe I can earn the amount we would need, in order to get a better quality of life, for her or both of us.

What’s the solution? Obvious, really: pay working people the living wage they deserve!

If the average wage was a reasonable amount (and I feel no need to bind anyone’s thinking here, so I won’t suggest one) then, firstly, the poor working man or woman would not feel so hard-done-by, with people on benefits pulling down as much as them or more yet having done no work for it, and bosses taking home obscene amounts generated by the efforts of other people.

Those on benefits would have less reason to feel victimised because the average amount at which their benefits will be pegged would be high enough for them to survive, and possibly even enough for them to think about how to get back into work and earn more money for themselves and their families (if they have them), rather than focusing solely on survival.

All this hinges on the bosses who, as we know, are extremely reluctant to share out the profits they haven’t earned for themselves. I have no sympathy for those on obscenely large salaries and bonus schemes – those in FT350 companies whose salaries have multiplied seven times in the last 20 years, while the firms’ performance has improved by only 23 per cent and the wages they pay their workers has risen by just 27 per cent (less than the rate of inflation). They can take a smaller slice of the cake and put up with it.

But what about the bosses of smaller firms who might be struggling to keep their heads above water? They might not be taking very much more than their workforce. What’s the solution for them?

To my way of thinking, they need to be competitive, and a demoralised workforce does not make a business competitive. Also, they need the tools to do their job properly and I can foresee a time when the economic situation will mean their equipment will be out of date.

Perhaps this is a time for the government – either local or national – to come forward with a match-funding scheme of some kind to keep these firms on their feet; but with one major condition. The companies should re-form into co-operatives, in which every worker has a stake in the profits. This would re-fire their enthusiasm and, hopefully, improve performance, leading to a knock-on increase in wages and bonuses that are not unearned drains on resources but based on real profit.

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